Skip to content
Link copied to clipboard

Stock market mostly flat at end of week of records

NEW YORK - Stocks finished a strong week mostly flat yesterday as investors tried to reconcile a weaker-than-expected estimate of first-quarter economic growth with fresh evidence that corporate profits remain robust.

NEW YORK - Stocks finished a strong week mostly flat yesterday as investors tried to reconcile a weaker-than-expected estimate of first-quarter economic growth with fresh evidence that corporate profits remain robust.

A modest advance in the Dow Jones industrial average sent the blue chips to their third record close in as many days.

A Commerce Department report that the U.S. gross domestic product grew at an annual rate of 1.3 percent in the first quarter - its slowest pace in four years - unnerved some investors and seemed to run counter to a parade of strong earnings reports that sent major indexes sharply higher during the week. The economy's growth was below economists' expectations and down sharply from 2.5 percent in the previous quarter.

The government data also showed that pricing pressures were rising, stirring concern that U.S. consumers may curb spending.

The GDP data helped push the euro to a high against the dollar; the 13-nation currency rose as high as $1.3682.

Keeping stocks afloat, however, was another round of robust earnings reports, notably from Microsoft Corp., one of the 30 companies that make up the Dow industrials. So far, 22 of the 30 Dow components have reported earnings, and 16 have exceeded expectations.

"I think the reason the market appears to be doing better than the economy right now is the decent job managers are doing at incorporating improvements in productivity," said Rob Lutts, chief investment officer at Cabot Money Management. "Corporations are making gains on the bottom line without making gains on the top line," he said, referring to earnings and revenue.

The Dow Jones industrial average rose 15.44, or 0.12 percent, to 13,120.94. The Dow set a trading high of 13,148.00 yesterday after surpassing 13,000 for the first time Wednesday.

The Dow's gain yesterday marked the 37th record close for the index since October. For the week, the Dow rose 1.2 percent.

Broader indexes finished mixed yesterday. The Standard & Poor's 500 index slipped 0.18, or 0.01 percent, to 1,494.07, while the technology-dominated Nasdaq composite index rose 2.75, or 0.11 percent, to 2,557.21.

For the week, the S&P rose 0.7 percent, while the Nasdaq gained 1.2 percent.

The S&P 500 is about 2 percent below its high of 1,527.46, reached in March 2000.

Wall Street has been eyeing the index, waiting for it to move back above 1,500; the S&P 500 hasn't closed above that level since September 2000.

The Nasdaq, meanwhile, is slightly above the halfway point to its high, which also came in March 2000.